Frequently Asked Questions

1. Why should I consider investing in Multifamily Apartments?

   • Please visit this page for a comprehensive answer: www.rxmcapitalgroup.com/why-multifamily

2. What is a Real Estate Investment Firm?

   • A Real Estate Investment Firm is the business entity that finds the property, puts the deal together and manages the investment from start to finish. They are also referred to as a Syndicator, Operator and or Sponsor.

3. What is a multifamily syndication?

   • A multifamily syndication is an effective way for people / investors to pool their resources to invest in multifamily properties which would otherwise be extremely difficult to achieve or manage on their own.

4. What kind of return should I expect?

   • Returns vary with each investment and we do not make any guarantees; however, we aim to bring opportunities to investors that have an Average Annual Return (AAR) of approx. 8-15% and a cash on cash return of approx. 8-10%. That coupled with the asset appreciating over the 5-7 year hold period you could expect to double your money.

5. What is Average Annual Return (AAR)?

   • This is a percentage used when reporting the historical return, such as the three-, five-, and 10-year average returns of an investment.

6. What is Cash on Cash Return?

   • Cash on Cash (or CoC) return is a factor that refers to the return on invested capital. It’s the relationship between a property’s cash flow (profit after operating expenses and debt service) and the initial equity investment. So, this will tell you what percentage of your invested cash is paid out each year in distributions.

7. What is Preferred Return?

   • If an investment has a preferred return, investors will be the first to receive their distribution returns up to a certain percentage.

8. How long should I expect my money to be tied up?

   • The Real Estate Firms we work with typically hold properties for a minimum of 5 years. However, in many cases there will be a cash out refinance within the first few years that will return some or all of investor capital. There is a very specific plan for each property / investment that will be explained up front to investors.

9. What criteria do we look for in a Real Estate Firm to consider them a trusted partner that we want to work with?

   • There are many factors that are considered when deciding to work with a Real Estate Firm. These include:

     • Proven track record

     • Integrity of the company and it’s principals

     • Communication style

     • Reputation

     • Timely distributions and end of year tax reporting

10. What is the difference between active and passive investing?

    • Active investors are part of the general partnership and manage the day to day operations of the asset.

    • Passive investors are part of the limited partnership and provide capital to help acquire the asset. As limited partners, they are not involved in the operations / management of the asset. They receive cash flow distributions (typically monthly or quarterly) and maintain an equity share through the life of the investment.